It can be tough to save for a down payment.
And most people don't wanna spend all their savings just on a down
payment when they also have closing costs, moving expenses, and then any
other money you need for things like furnishing or moving into your new home.
So I'm gonna show you how you can get a loan with 0% down.
And this isn't a gimmick.
This is actually a major type of loan and it's not down payment assistance.
This is through a loan called USDA and it doesn't involve any meat that
I know of, but what it is, it's a loan for what are called rural properties.
And before you think it's for farmland, it is not just for farmland. A USDA
loan works on certain areas that have a population size below a certain amount.
So I wanna show you.
What a USDA loan looks like when you get 0% down.
So you can Google USDA property eligibility to find the eligibility map.
Now, something interesting to note about USDA it's one of
the four main types of loans.
So we have conventional loans, FHA loans, VA loans for veterans and USDA loans.
Okay.
To qualify USDA
we need to make sure that the home is located in a USDA eligible area.
And if you wanna know more about USDA loans, I do have a video
that walks through the loan requirements for USDA loans.
Now, the map here, I will admit kinda sucks.
It's a little tough to use.
And last I tried, you're not able to put in a zip code.
Yeah, you need to put in an exact address.
So instead, what I do is just use this little slider.
Now you can see right away, USDA, actually covers a lot of areas on this map.
Anything in this kind of tan orange is ineligible.
So most of the US is eligible for USDA.
What I've found is most people can extend their commute by maybe 10 to 30 minutes.
And I know 30 minutes gets on the high end to extend the commute, but if you're
able to get into a home quicker, and that's your goal, USDA allows you to do.
So we're gonna look in Dayton since that's where I am located.
So let's zoom in here really quickly.
Let's say that you are wanting to move to Dayton.
You wanna live in Dayton.
Your job is in Dayton.
Right here.
Now, obviously everything here in the orange is ineligible for USDA.
Now, everything outside here is eligible.
We could do 0% down in any single one of these cities.
Okay.
So what a lot of people will do around here is they might look
at someplace like Tipp City.
So they can't find a home in Dayton for 0% down, but any home up here in
Tip City qualifies for 0% down, as long as you qualify for a USDA loan.
Now, quick note, before we go into the income limit here and the qualifications
for USDA is that if you're looking for a helpful real estate agent or
helpful loan officer, I have a link in the description for referral program.
We've helped thousands of people take the next step into connecting with a real
estate agent or connecting with a loan officer to get their preapproval started.
So let's take a look here at Zillow really quickly.
I'm gonna look at Dayton and let's pull up an a map.
Wow.
What took me?
Daytona Beach, Florida.
That is definitely not it.
There's definitely more beaches there though.
Okay.
So plenty of homes in Dayton here.
We wanna look up here in Tipp City.
All right now, something we need to know first, before we look at some of these
homes is USDA doesn't have a loan limit.
Instead they have an income limit that changes based on
the county that you're in.
So we're gonna use this same webpage here for USDA and go to income eligibility.
Once you're here, we'll go ahead and pick the state and the county.
Okay, then you're gonna put in how many people are in the household.
Let's say there are two no one under 18 will click next and
they make you put in your income.
You can put in anything in here and it will show you the maximum for your county.
I'm gonna go ahead and click finish.
Okay.
So it says we don't meet the income limit.
That's okay.
I just wanna know what the income limit is here.
So we can see the maximum adjusted household income is $103,500.
So we can't make more than that.
If you make more than that, you then you won't qualify for the USDA loan.
So as long as you make under that, we can qualify USDA.
Now from here, then I wanna get a better idea of what home I could afford.
So we're gonna keep this in mind, $103,000.
I'm gonna go to my max purchase price calculator.
What this does is it takes your scenario and it will help you find what an
estimated maximum purchase prices along with the monthly payment closing costs and
walk you through all of the numbers there.
So I'm gonna go in here and do 0% down.
And let's say that let's say we make 50,000 and let's say we have a
co-borrower that makes 50,000 as well.
You can also enter any debts that you have here, and then it will show
you a suggested maximum purchase price based on different risk levels.
So 300,000 as a maximum purchase price is going to be based off
of a conservative risk estimate.
With USDA you might be able to go up to something closer to a moderate
risk, but conservative, I think is where we're gonna stay right now.
300,000 here.
Okay.
So now let's take a look then let's take a look in Tipp City.
So we have this border here.
Let's go up to, what did we say?
302 and take a look at what homes are.
Okay.
So these may or may not be the style that you're looking for, but you
have quite a few there's a little bit of land trying to see if there's
some interesting homes in here.
So 300,000, this will get you home in Tipp City.
We could do 0% down on this.
Let's see, we could do all these homes here because they're in Tipp City
are going to qualify for 0% down.
Okay.
Now this may not be the ideal situation for you.
Having to change your commute.
Maybe it's not the city that you wanna live in.
But this is kind the compromise that USDA offers.
Basically instead of having to do 3% down on a conventional loan
for first time home buyer, three and a half percent down on a FHA loan
you're able to do 0% down on these homes if you change your commute.
Because if we look here, I'm gonna pull this up in an incognito browser.
So it doesn't suggest places I've been let's see, Tipp City
directions to Dayton is 20 minutes.
So basically the option that somebody may have in this situation is they put
a down payment on a home in Dayton and are closer to where they wanna live.
Maybe that's an option that you want, but if you're saying, you
know what, I am strapped for cash.
I have money, but I need to save that for something like the closing costs or moving
costs or renovation costs or whatever.
And I wanna save that money.
So I don't have to put it on the down.
You could look at moving outside a little bit further and going with 0% down now,
it's important that you keep in mind when you do buy a home, no matter if it's
a conventional loan or a USDA loan or whatever it is that you still have closing
costs with it, you're going to need to pay for an inspection and an appraisal
and a title report county fees, property.
Possibly property, transfer taxes, escrow accounts, things like that.
So keep that in mind, get a quote from a loan officer when you're
ready to take that next step.
Okay.
If you wanna learn more about USDA loans right over here, I
go through all the details and the loan requirements for USDA.